Honda cuts more production in major Western markets

By Chang-Ran Kim, Asia autos correspondent

TOKYO (Reuters) - Honda Motor Co said it would build fewer cars in Japan, Europe and North America to reflect an increasingly bleak outlook for sales as the global economic crisis discourages big-ticket purchases.

Automakers around the world are suffering from a severe and deepening downturn in demand, eating away at cashflow and threatening the future of Detroit's Big Three automakers -- General Motors, Ford Motor and Chrysler LLC.

On Friday, Fitch Ratings downgraded the long-term debt ratings of Nissan Motor Co to BBB-plus from A-minus, assigning a negative outlook citing its dependence on the flagging U.S. market.

Honda, Japan's No.2 automaker said it would cut output at its Saitama factory near Tokyo by 40,000 vehicles due to slow sales of Accord sedans, mainly bound for North America and Europe.

It will also chop production by an additional 21,000 cars at its UK factory, bringing the total reduction there to 53,000 units in the year to March 2009, more than 20 percent of annual capacity.

The latest move follows Honda's announcement that it would cut another 18,000 cars in the United States, and brings the output reduction to 150,000 cars globally for 2008/09.

At the start of the business year in April, Honda had planned to sell 4.14 million cars. It does not provide a production forecast.

ET TU, HONDA?